SitusAMC has struck a deal to sell a majority stake of two subsidiaries focused on mortgage risk management to investment firm VineLight Venture. The terms of the agreement were not disclosed.
The transaction involves the loan insurance firm Securent Risk Retention Group along with its data, brokerage and services business, Risk and Insurance Services. It comes as Securent seeks capital to invest in rising-demand products, especially in the residential mortgage-backed securities (RMBS) space.
“Repurchase demands continue to be a material impediment and concern for mortgage company leaders, and fraud-related risk will continue to be a challenge throughout the mortgage manufacturing process, especially in RMBS structures,” Justin Vedder, the president of Securent, said in a statement.
Vedder will continue to lead Securent. He previously worked with VineLight’s principals, Bryan Binder and Jason Garmise, at CastleLine, a provider of mortgage data and insurance products.
Binder said the focus is on providing “innovative solutions to the mortgage industry,” which will improve “efficiency and profitability” and “transform the securitization market.”
SitusAMC will maintain a minority stake in Securent and a seat on its board. SitusAMC CEO Michael Franco said the deal “will enable the business to offer a more diverse set of insurance solutions to the industry.”
Securent was founded in 2021 to provide mortgage companies with risk management, data analytics and insurance programs. It covers topics such as underwriting defects, compliance violations, fraud and misrepresentation, and appraisal errors.
